MULRONEY CALLS FOR RESTRAINT BY SEPARATISTS

TORONTO, FEB. 13 -- Warning against the "dream merchants" of separatism, Prime Minister Brian Mulroney challenged the French-speaking majority of Quebec today to consider the potentially disastrous economic consequences if it votes to divide the province from Canada.

In an unusually blunt and ominous speech delivered almost entirely in French to an audience of business executives in Quebec City, Mulroney declared: "Whatever those may say who would like us to remain silent while they are demolishing Canada, it is not economic blackmail to ask Quebecers to look carefully at the facts before making decisions that involve their well-being and that of their children."

Mulroney said he is committed to constitutional reform and prepared to discuss a redistribution of powers between the federal and provincial governments, but he stressed that "threats or ultimatums are not the way to build together a new Canada."

His remark was a reference to a late-1992 deadline set by Quebec Premier Robert Bourassa for Canada to agree on a new constitution giving Quebec exclusive powers in 22 fields, including 11 now wholly or partly controlled by the federal government. These include public security, agriculture, unemployment insurance, energy, the environment, industry, commerce and language.

The demands go far beyond a proposed set of constitutional amendments -- known collectively as the Meech Lake accord -- that collapsed during federal-provincial negotiations last June. That initiative, undone by opposition from English-speaking provinces, would have granted Quebec special status as a "distinct society" and given it and the other provinces some powers now held by the federal government.

The new demands were put forth by Quebec's ruling Liberal Party, and Bourassa has said that if they are not met within 21 months, Quebec will decide by referendum if it should "assume the status of a sovereign state." A sovereign Quebec, Bourassa said, would offer English Canada an "economic union, managed by institutions of a confederal nature."

Mulroney's address to the Quebec Chamber of Commerce was his second in two days on the consequences for Canada of Quebec separatism. Tuesday, in a speech to businessmen in Toronto -- the heartland of English Canada -- the prime minister warned his audience against making "careless statements like 'Let {the Quebecers} go,' " and he declared that just as people must realize that Quebecers will not negotiate on their knees, "the rest of Canada cannot be expected to negotiate with a knife at its throat."

In that speech, which included an emotional appeal for national unity and a warning that a Quebec separatist drive would be corrosive, bitter and expensive, Mulroney said: "Either you have a country or you don't. You can't have it both ways."